The nationwide drought has sucked $12.3 million from Landcorp's earnings, the government-owned farmer says.
The company would break even for the year, though a change in the weather could alter that, chief executive Chris Kelly said yesterday.
However, the Government's expectation of a year-end dividend would not be met.
Milk production was 6 per cent under budget as most dairy farms reduced milking. Almost half of Landcorp's 50,000 cows would be dried off by the end of April to ensure good cow condition for next season.
Because the drought was so widespread, Landcorp had limited opportunity to alleviate its impact by moving stock around its 119 dairy and sheep and beef farms.
It had managed to ship 10,000 trading lambs from North Island farms to those less affected in Canterbury and Otago.
Tight space at processors had slowed the outflow of finished lambs and in the South Island specifications had been changed to hasten the kill.
Good cost management had partly offset the fall in income, Kelly said.
The company's focus was on protecting capital and young stock condition and increasing pasture covers.
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